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Correction to This Article
Earlier versions of this article, including in the print edition of The Post, incorrectly said that, if a new hospital is approved, it would be the first time in 30 years a new hospital is being built in Maryland. In fact, it would be the first time in 30 years for Montgomery County. This version has been corrected.
Battle over Md. hospital could be decided soon

By Lena H. Sun
Monday, December 13, 2010; B03

Two health-care giants have spent the past two years waging a costly and intense battle to win state approval to build a new hospital in northern Montgomery County, the county's fastest-growing region.

It would be the first new hospital in Montgomery County in 30 years. The state's health-care commission is scheduled to decide next month which project, if any, should proceed. The commissioner in charge of the review is expected to release a key recommendation as early as this week, officials said.

Adventist Healthcare and Holy Cross Hospital each want to build a hospital in an area where the population is growing and aging faster than the rest of the county as a whole, officials say, and would therefore need more health-care services. The rival facilities are only a few miles apart; industry officials say it is unlikely the state would approve both.

The competition is taking place at a time when hospitals across the country are under intense pressure to protect or expand their market positions. Those pressures will probably grow, experts say, under the federal health-care overhaul passed in March that emphasizes shorter hospital stays and a decrease in the use of hospital services.

"Hospitals need to make up for that with more market share," said Dan Grauman, president of DGA Partners, a health-care consulting firm. "They need to drive volume. They want to be closer to growing population bases."

Affluent Montgomery, with nearly 1 million residents, is attractive because of its large number of well-insured residents, including federal retirees, who can pay for services. By contrast, less-affluent areas such as Prince George's County and the District have a large number of poor and uninsured patients. Last year, Baltimore-based Johns Hopkins acquired Suburban Hospital in Bethesda, converting the Montgomery hospital into a Hopkins subsidiary.

Adventist and Holy Cross have spent millions of dollars on the time-consuming application process for a certificate of need from the Maryland Health Care Commission, an independent body that will make the final decision. Such a certificate would give one or both health-care giants the right to build.

Case documents fill dozens of boxes at the commission's Baltimore office. Thousands of public comments include postcards and handwritten notes. Both hospital systems have created Facebook pages promoting their positions.

"It's a very big deal," said Pamela Barclay, director of the commission's hospital services division. "These are good, strong hospitals, and they would like to continue to be good, strong hospitals and expand what they're doing."

Adventist Healthcare, Montgomery's largest employer, operates two acute-care hospitals - Shady Grove Adventist in Rockville and Washington Adventist in Takoma Park - and an emergency center in Germantown. Holy Cross Hospital in Silver Spring is the county's largest hospital and is part of Michigan-based Trinity Health.

According to updated plans, Adventist wants to place an 86-bed facility in Clarksburg, along Interstate 270 between Shady Grove Adventist and Frederick Memorial hospitals. That hospital would be part of a medical complex that has office buildings for doctors and a nursing home. Rival Holy Cross proposes a 93-bed hospital on the Germantown campus of Montgomery College, a few miles south. That hospital would provide on-the-job training for nursing students.

The jockeying has been intense, and many county officials have chosen to stay neutral.

William "Bill" Robertson, president and chief executive of Adventist Healthcare, said the dilemma for county officials was like asking "which baby are they going to choose?"

County officials say there is no question that upcounty's aging baby boomers will need more health-care services.

"We absolutely believe we need a hospital in that upcounty area," said Chuck Short, a spokesman for County Executive Isiah Leggett (D). "What is not acceptable is to have no hospital."

Democrat Craig Rice, a former state delegate elected this fall to represent the upcounty region on the nine-member County Council, said that either hospital would be a "win-win."

The state commission must evaluate projects based on several criteria, including geographic accessibility, effects on the existing system and cost effectiveness.

In May, a report from the Maryland Health Services Cost Review Commission, which sets hospital rates, said it doubted that either side could finance, construct or operate a new facility. Among the reasons cited were reduced hospital reimbursements under the health-care overhaul, a bleak economic forecast and the costs to each hospital for other planned capital projects. Together, those factors present "challenges that are well beyond the realistic ability of the applicant hospitals," according to the state commission's report.

Another critical factor is population growth, which each side has used to support its proposals. As part of its analysis, the state commission is digging deeper than existing county planning or census data to identify population changes at the Zip code level, Barclay said.

Several women's groups, including Planned Parenthood and Montgomery County NOW, have raised concerns about the Holy Cross project because of Catholic religious directives that restrict some services, such as fertility treatments, birth control and abortion.

"If you're going to a build a hospital, you want to meet the needs of all residents," said Jennifer Blasdell, executive director of NARAL Pro-Choice Maryland. Women commonly have tubal ligations after Caesarean deliveries, but the surgical sterilizations "wouldn't be offered," she said.

Holy Cross officials said they were deferring comment until after the commission reviewer's recommendation is made public. In a written response to questions, the hospital called discussion of reproductive services a "distraction."

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